Last Sunday, Italian state TV broadcaster RAI transmitted a film on the life of Chiara Lubich, the foundress of the Focolare Movement, which I enjoyed watching tremendously. I was then tempted to read more about her and discovered that one of her initiatives was the so-called ‘economy of communion’.
A few days before, I had come across an article written by Robert Reich in The Guardian online version about inequality and the free market. Reich claimed that in order “to reverse inequality, we need to expose the myth of the free market”. I put the two together and this triggered this week’s contribution. But let us proceed with order.
In brief, the ‘economy of communion’ encourages businesses to consider themselves as an integral part of the communities they operate in. In concrete terms, this means that businesses, after putting aside funds to make the business sustainable, commit themselves to give part of their profits to those in need and to promote the culture of giving.
Nowadays we may call it corporate social responsibility. However, it really goes beyond that as the ‘economy of communion’ also demonstrates itself in the way such businesses treat their employees, their clients, their suppliers and the public. To my mind this certainly emphasises the importance of the common good in the management of businesses and the management of the economy.
On the other hand, it goes against the myth that the aim of any business is to maximise its profits. I call it a myth because Peter Drucker, the person who is accredited as having laid the foundations of the modern business corporation, had stated that the objective of any business is not profit maximisation but “to create and keep a customer”.
The human person, and not profit, needs to be at the centre of our economy
We have been led to believe that the free market is the answer to everything and that the less state intervention there is in an economy, the better that economy performs. Even this turned out to be a myth because the unregulated operation of the free market has led to great social and income inequalities and has caused damage to our environment.
This brings me to the article I read in The Guardian. The writer claims that a few billionaires have seen their financial “fortunes soar even during the pandemic”. These people have over the years stated that their wealth should not be taxed in order to support the common good. They have even convinced governments with their arguments. However, we know that such a policy benefitted only these people and certainly not the common good.
Pope Francis had spoken about the economy that kills and the economy of exclusion and inequality. He had written in his apostolic letter, ‘The Joy of the Gospel’, that it is very ironic that food is thrown away while millions are starving, and that a small drop in the stock markets makes news while the death of homeless people does not. As a result, the unregulated operation of the free market has enabled “the powerful to feed upon the powerless”.
The COVID-19 pandemic was the latest crisis to prove that market forces alone and ‘trickle-down’ economic policies (governments should reduce taxes for the wealthy because eventually economic benefits will trickle down to the rest of the economy) had failed to produce the social benefits their promoters claim. It is simply not true that it is only natural and inevitable that wealth and power gets concentrated in the hands of a few persons.
These are issues that we need to address in Malta as well. They are not issues that concern only the larger economies. Our country’s economic policies need to be driven by the principles of the common good and the ‘economy of communion’. The human person, and not profit, needs to be at the centre of our economy.
There cannot be any segments of our society who believe that they have some unalienable right to become wealthy, at the expense of the rest, even if their activities harm the common good, just like the kings centuries ago thought they had a divine right to rule and were not accountable to anyone.